The Challenges

The commercial pressures on organisations are universal and ever-present

Growing Market Share

Increasing Profitability

Realising the value of Mergers & Acquisitions

Reducing Operational Expenditure

Improving the experience of the consumer

Satisfying Regulation

BPR Revisited

21 years after its publication

‘Reengineering the corporation: A Manifesto for Business Revolution’ (J.Champy and M.Hammer, 1993)

has Business Process Re-engineering been enough?

"Dr. Hammer points out a flaw: He and the other leaders of the $4.7 billion re-engineering industry forgot about people. 'I wasn't smart enough about that,..” Wall Street Journal 1996

‘In spite of the concept’s popularity, between 60 and 80 percent of reengineering efforts fail to achieve their goals’A Review of Success Factors and Challenges of Public Sector BPR Implementations, Marlen Jurisch et al, 2012 45th Hawaii International Conference on System Sciences

The responses are also universal

Consolidating business units

Improving product or service quality

Outsourcing and procurement of services

Reducing the total cost of ownership of business solutions

Head-count reduction

Information Integration

Process automation

System numbers reduction

Innovation

Today it is a tremendous challenge to make tactical projects fully effective, or to carry out strategic change. The raw material, the operational activities, remain locally defined and often peculiar to each division, in each organisation. There is no best practice for guidance and no overarching technical discipline. The direction and nature of the change has to be determined locally, often with very few Subject Matter Experts able to contribute. The result is that organisations develop parts that interlock like complex jigsaw puzzles rather than a smoothly running machine

OIS improves organisationalefficiency and reduces whole life cost of automation and out-sourcing

Individual projects are no longer constrained by the availability of Subject Matter Experts because their experience is distilled into best practice, which are combined with immediate business needs so projects are directed with authoritative requirements and design. Standard InterOperations curates the library of best practice and promotes sector-wide standardisation

Best Practicesimproves operational efficiency

Standards establish authoritative requirements that reduce the risks of procurement projectsStandards enable products and services that are usable off-the-shelf

The success rate of general outsourcing of services, in large organisations; enterprise, government, health care, armed forces and so on, is not easy to generalise. There is a great deal of variety in both aims and methods. There are dramatic and well known failures of public sector outsourcing projects as well as equally dramatic, but little known ones.

The general issues are well aligned to the more specific case of IT procurement, where a more consistent method makes it more open to analysis

What if 2 out of 3 Buildings were Condemned?

A startling ZDNet headline. Of course the headline is not the full story. Failure is not just about cancellation. It is measured as the degree of cost overrun, duration overrun and features shortfall

What really makes this headline so startling is that this statistic is no where near properly acknowledged, even though most practitioners have experienced it. This level of failure has become accepted. It is business as usual

Enterprise software is a sector where every construction worker has also to be a fire fighter

For some, that is why they love it. That is why they succeed. Non the less, when failure is not acknowledged or simply denied, then

something is rotten in the state of enterprise software

Reducing the Risk of Transformation Projects

The risk arises because each one is built from scratch, with little, or no reuse and is unable to reference an authoritative source for operational best practice

The Requirements Challenge

An organisation will have a clear understanding of its operational units, in terms of roles and responsibilities. This is a high level understanding. If a decision is made to transform an operational unit, by automation, or outsourcing, it is clear that this level of understanding is not fine-grained enough to use as the requirements for the project. This is expected, which is why there is always a specific requirements and design phase planned in into any project

The activity of operational units becomes more fuzzy, when they are looked at closely

Much of the detailed operations are only known to individual Subject Matter Experts

How OIS is Used

The Standard InterOperations solution is simple enough in principle:

Draw on operational expertise to ensure complete specifications of each operational activity carried out by a unit

The activities only need to be specified at the hand-offs to neighboring units

Each distinct activity is modelled as an OIS Contract

The set of OIS Contracts specify, in complete operational detail, the role of the operational unit and readies that unit for automation, or outsourcing. The next steps converge best practice across the whole sector

Develop the specification for neighboring operational units

Share the basic, commodity activities across the sector to turn them into standards

Curate the standards in an independent authority to maintain them for the sector

The design and requirements specification will use whatever expertise is available at the time and will be documented in natural language, which is ambiguous. Much of the risk in an operational change project is created at this phase

OIS enables the boundary of an operational unit to be defined precisely. It does so by marking the boundary with individual OIS Contracts

There is no need to define how the unit works internally. That will be down to the Managed Service Provider, or software system and should be open to the provider to develop and improve with their own specialist and proprietary capability

What is required is:

to define are the hand-offs to neighbouring units

to capture all the operations carried out

OIS Methodology will reduce the risk of cost overrun, delay and reduced features for any operational change project

OIS Impact on IT Project Duration

Any project activity that requires subject know-how takes significantly less time in a mature OIS sector. This is a representation of the impact OIS has on an IT project, but many of these stages apply to non-IT procurement and outsourcing

Operational requirements and Design both reuse existing OIS Contracts. Only new features need effort

Adjudication of submissions from the Invitation to Tender (ITT), or Request for Proposal (RFP) take less effort, because both the supplier responses are against the same OIS Contracts used in the invitation

Implementation and integration are already specified by the OIS Contracts. Effort is required to detail new features not in the standard

Development effort is reduced by using off-the-shelf products and reusing previous customisations, which are represented as feature enhancements to the common OIS Contracts

Training effort is reduced due to standardisation of operations in OIS

Reducing duration is only part of the story. Arguably more important is the reduction in risk from using established and high quality requirements and design drawn from expertise across the sector and embodied in OIS Contracts. Risk and whole life cost are further reduced by minimising custom code, which is always less stable and harder to maintain and than tried and tested product

Value of OIS According to Personas

To better understand the value of OIS, consider it from the perspective of key individuals

Chief Operating Officer - responsible for the people and the work they do

Chief Operating Officer (COO)

COO Responsibilities

I am responsible forthe people and operations of my organisation. This includes;

operational efficiency

legal and regulatory compliance

head count reduction

outsourcing

ensuring that operations are fit for purpose to support the organisation’s mission and vision and market offerings

enabling growth strategies and new technology introduction

consolidating departments, including those acquired through M&A

How OIS Benefits Me

OIS helps me drive operational efficiency by providing a target for transformation that is reliable, because it comes from the experts across the whole sector and is stable, because it is independent of management changes in our organisation

I am able to remove unnecessary variation in the way similar activities are performed so that they can be carried out with a single set of training, people and systems. Ultimately I am able to consolidate departments

OIS reduces the risk of introducing new operations to support new products, services and technologies into the organisation by drawing on the experiences of other organisations from across the sector.

When products, services, or technologies are so new that they have not been tried elsewhere, then we know it is going to be genuinely differentiating for us and we are happy that is where we want to focus are risk and budget

OIS enables people to be recruited who have already been trained in processes and systems that are common across the sector

Because OIS is accepted across the sector, including the regulator, adopting OIS operations helps me with transparency and alignment with regulation

As an early adopter of OIS, I know I cannot use OIS Contracts off-the-shelf, but I am glad to have the opportunity to align OIS standards to our own processes and operations and also benefit from other industry experts who will help improve those processes and operations. The effort of gaining these advantages is much the same as normal requirements and design effort. The additional activities are in collaborating with other organisations through Standard InterOperations, but because the output is validated and reusable, the effort is justified

Responsibilities of COPO

I purchase business solutions for my organisation. This may be bringing solutions into the organisation, or tasking our activities out to an external service provider. I am responsible for

specifying the services to be performed

finding the minimum cost solutions that meet all the required features

whole life cost of the solution

auditing service against SLAs

remedial action

contract renewal

legal and Commercial aspects of the contract

How OIS Benefits Me

OIS enables me to specify my requirements precisely and unambiguously, with their dependencies and the required Service Level Agreements (SLAs). This is only possible because I can make full use of Subject Matter Experts from across the sector when producing an RFP (Request For Proposal), or ITT (Invitation to Tender). Their know-how is modelled in the OIS library. It means that the basic, common features of the project are understood from the start and the risk of subsequentlydiscovering omissions and errors is minimised

The value of using OIS is in reducing the risk of failure because of either cost overrun, delay or missing features in the product and services I procure. Our exposure to a number of factors is reduced:

Penalty payments for our missed targets

Unplanned costs for making good services that the supplier has failed perform

Delays in delivering our services as we find alternative suppliers

Re-tendering costs

Delays associated with re-tendering

Cost of legal action

OIS enables me to speak the language of my services and features in ITTs/RFPs and to assess the responses on our own terms. Before OIS, we had to analyse large volumes of documents from suppliers. Each supplier would take a different approach, but all of them would be in the language of their offerings, rather than our requirements, so it would be left to us to establish how well suppliers supported our needs and there was plenty of room for misunderstandings.

Now we use OIS Contracts to express our requirements and Vendors use the same Contracts to map their offering to our requirements. OIS enables me to directly assess responses and makes the non-conformances clear allowing remedial action to be factored in as part of the project

I am an early adopter because I accept that our procurement process does have flaws and I want to show that we are doing something about it. OIS lets us apply the methodology to one area, without significant additional costs, or the risks of wholesale transformation. Its cost are justified just by documenting how our operations are performed for future reference

The result is that both the risks and the time to deliver a procurement, or outsourcing project is significantly reduced

Responsibilities of the SME

I am an operational expert in a core activity of my organisation. As far as I am aware, I am uniquely experienced in my subject within the organisation, though I work closely with colleagues in neighboring areas

My time is fully occupied supporting projects that need my skill

I spend much of my time reviewing internal project proposals and detailing requirements and designs for new projects

I spend most of my time adjudicating submissions from internal and external suppliers and understanding their fit to our requirements

How OIS Benefits Me

OIS enables me to capture my know-how in a model that I can manipulate and improve. I can share my expertise with colleagues and help them understand the issues and dependencies. My personal contribution to each new project is no longer necessary to ensure rigour

Before OIS, much of my work was repetitive. This is no longer the case as I can simply reference in new projects those OIS models I have already helped to develop. I now focus my time on what makes the new project different and enhance the OIS models to reflect the new features

Before OIS, ITT/RFPs were freshly composed for each new project, even though the majority of the requirements were the same. Each supplier took a different approach in their responses, with the only common factor being the thickness of the documents to be worked through. Now requirements are couched in off-the-shelf OIS Contracts and supplier respond with their alignment to those OIS Contracts. The ITT/RFP process now takes much less time and is much more constructive and thorough, focusing on valuable differences, not common commodity features

Standard InterOperations provides an external point of reference for me. My area of expertise was considered a trade secret within my organisation, even though my personal contacts tell me that other organisations do almost exactly the same things and could not do otherwise. OIS helps my organisation understand what is common best practice across the sector, so we can to focus our efforts on our unique values and offerings. This is much more satisfying work for me to get involved in. Everything else can be taken off-the-shelf.

I have much more confidence in using the standardised best practice in projects, because it is agreed with other organisations, including suppliers. This also helps me defend my position in projects, so my recommendations of good practice are less likely to be overruled when it comes to scoping. The result is that projects are more likely to be successful

It is personally very satisfying to contribute to SIO work because it makes clear the commercial value of what I do. My subject area feels more like engineering, with skilled practitioners, authority that comes from a library of best practice and a means to enhance the technical discipline

In the longer term, I have the ability to compare my skills to experts in other organisations. I am much more confident about what will happen to my role when I move on

I have the time and tools to model and communicate my expertise

I can pass on my skills to new colleagues - without having to even meet them, though that is not the ideal way

I am an early adopter because this is the best time for me to contribute. I can provide leadership to help establish my career long skills as an acknowledged discipline, with its value to the sector made much more explicit and visible. This will give me visibility outside my organisation and a group of peers I can work with. It will no doubt help my profile within my organisation too

I feel confident that my skills will be understood and welcomed in other organisations, because it is now an acknowledged discipline

How OIS Benefits Me

Responsibility of the Client Principal

The Client Principle manages the relationship their organisation has with a client as follows.

Leading the engagement for new business

Intercepting client issues before they become a problem for the relationship and before escalation

Ensuring the rapid resolution of client issues

Ensuring good communication between the two organisations

Keeping track of personnel changes in the client, especially at executive level

Advising the client on market trends and strategy

Ensuring contractual agreements are kept on both sides

OIS enables me to create one set of responses to ITT/RFPs and to ensure that they are of high quality. This is because OIS gives us a one time activity to describe how each of our offerings is used to perform the OIS Contracts we support. This means we can use off-the-shelf material to respond to the the major part of any ITT/RFP that uses OIS Contracts to specify requirements and design. More importantly, it means that our technical team can spend their available time on making clear the additional value that we bring as a supplier, over and above the standards

Another advantage of OIS is that the client uses OIS Contracts as the context to specify the new and differentiating features that they wish to develop. This leads to a precise and unambiguous description of the new features. The context makes it is easier to understand the additional requirements, which, by their very nature are going to be unfamiliar

We are much less dependent on the few Subject Matter Experts that we have as most of their effort has already been spent in modeling our offering as OIS Contracts. The SMEs update the model as we develop new features in our offering and they support our responses for the novel features requested by our clients, but they do not need to be involved in the standard material

After the response phase, we have a much shorter time to wait before receiving feedback from the client. Our responses use the same OIS language as their proposals, so our clients spend much less time analysing and level-setting responses

When it comes to testing and interoperability, these are defined by the OIS Contracts. The effort of interoperability testing is reduced to showing that we can actually do what we claim. We no longer hand-craft integrations, so long as our client is using OIS Contracts as their interface specification. Integration work goes into legitimate paid services effort to implement any new, non-standard features

I am happy being an early adopter of OIS because it enables me to engage with our clients strategically and demonstrate our long term commitment to the sector. This helps us differentiate ourselves from other suppliers. Of course it is also useful to have OIS develop under our influence so that it is more aligned to our offerings, but working with other leaders in the sector will also help remove unnecessary features in our offering

Our relationship with our clients are less likely to become strained. There are fewer unexpected issues and challenging areas are clearly indicated from the start and properly managed

How OIS Benefits Me

OIS dramatically reduces both the time and cost to initiate a new projects and the the time and cost of performing the project. Instead of requirements, design, architecture and ITT/RFP processes being repeated for each commissioned project, much of the highest risk effort, that depends on subject matter experts, can be replaced with off-the-shelf specifications, designs and architectures. The ITT/RFP processes are significantly reduced to compliance with the required OIS Contracts and financial factors. Instead of requiring hand-crafted code to integrate software systems, they are replaced by off-the-shelf integration specifications

OIS provides an authoritative and independent strategy for system migration and consolidation, which is not subject to the changes in personnel, management, or structure in any one organisation

OIS reduces the total cost of ownership (TCO) of software systems in a number of ways.

Reducing the cost of re-work and feature enhancement by ensuring that systems are specified to meet the full set of operational requirements as recognised by the sector. Not all of these need be implemented, but omissions can be justified and solutions built for low impact enhancements

Standardising basic operational activities so that they can be supported by lower cost common, off-the-shelf (COTS) software products that are customised only for genuinely unique and differentiating features.

Reducing maintenance charges by using COTS products with minimum customisation

I am an early adopter because I want to show that we understand IT projects are challenging and that we are doing something about it. OIS gives me the opportunity to introduce IT style tools and methodologies to the general operations environment and start to demonstrate that IT is no longer just in a supporting role, but information systems must become central to the organisation's strategy

OIS allows me to focus time and effort on the new and differentiating features of our systems to help lead organisational transformation and not on the standard, expected features